Snap lays off 10% of workforce in tech sector bloodbath
Snap said Monday it will lay off 10% of its workforce, adding to an ongoing bloodbath among US tech giants since the start of the year.
Snap said it expects to incur pre-tax charges “in the range of $55 million to $75 million” as a result of the cuts.
The costs are “primarily consisting of severance and related costs,” with the majority expected to be reflected in the company’s first-quarter results, according to a regulatory filing.
“In order to best position our business to execute on our highest priorities, and to ensure we have the capacity to invest incrementally to support our growth over time, we have made the difficult decision to restructure our team,” the filing said.
The round of layoffs likely affected about 540 employees, based on the company’s stated headcount of approximately 5,400 workers as of last September.
Snap shares fell 1.8% on Monday.
The company has struggled with sagging revenue from digital advertising in recent quarters.
The company did not immediately return The Post’s request for comment.
With the layoffs, Snap may be trying to emulate the recent success of one of its key rivals, Facebook and Instagram parent Meta.
The company’s profits have surged since last year, when CEO Mark Zuckerberg declared a “year of efficiency” that included mass layoffs.
Last Friday, Meta’s stock surged 20%, posting the largest single-day market cap gain in history –$197 billion — after the company revealed its earnings had more than tripled compared to one year ago.
The company also announced its first-ever quarterly dividend, which is expected to give Zuckerberg an annual windfall of $700 million.
Meta’s global headcount was 67,317 as of the end of last year, down 22% from the previous year.
Snap is the latest in a wave of companies to announce layoffs since the year began.
Google laid off well over 1,000 employees across various divisions last month as the company shifts resources toward developing advanced AI.
The company’s boss Sundar Pichai identified “durable cost savings” as one of Google parent Alphabet’s key goals for 2024.
Elsewhere, struggling online marketplace eBay laid off 9% of its workforce, or about 1,000 workers. Microsoft and Amazon have also slashed their headcounts.
Snap CEO Evan Spiegel was one of several notable tech executives who faced tough questions from a Senate panel last week about the child online exploitation crisis plaguing social media platforms.
This is a breaking story. Check back for updates.
